Score:OmOpts P6-28 (similar to) Question Help Related to Checkpoint 6.2) (Presen

Question

Score:OmOpts P6-28 (similar to) Question Help Related to Checkpoint 6.2) (Present value of annuity payments) The state lottery's milion-dollar payout provides for $1.1 million to be paid in 20 installments of $55,000 per payment The first $55,000 payment is made immediately, and the 19 remaining $55,000 payments occur at the end of each of the next 19 years. I8 percent is the discount rate, what is the present value of this stream of cash flows? If 16 percent is the discount rate, what is the present value of the cash flows? whatisthepresechofeofthe dues! (Round to the nearest cento a. If 8 percent is the discount rate, the present value of the annuity due is (Round to the nearest cent) orrect: 1 Enter your answer in the answer box and then click Check Answer Clear All

Explanation / Answer

Dear Student Thank you for using Chegg Please find below the answer Statementshowing Computations Paticulars At 8% At 16% Annual Payment                 55,000.00                       55,000.00 PVF for 20 Years                     10.6036                             6.8775 PV of the Annuity               583,197.96                     378,260.05 Time PVF at 8% PVF at 16%                                                                                -                              1.00                                  1.00                                                                           1.00                       0.9259                             0.8621                                                                           2.00                       0.8573                             0.7432                                                                           3.00                       0.7938                             0.6407                                                                           4.00                       0.7350                             0.5523                                                                           5.00                       0.6806                             0.4761                                                                           6.00                       0.6302                             0.4104                                                                           7.00                       0.5835                             0.3538                                                                           8.00                       0.5403                             0.3050                                                                           9.00                       0.5002                             0.2630                                                                         10.00                       0.4632                             0.2267                                                                         11.00                       0.4289                             0.1954                                                                         12.00                       0.3971                             0.1685                                                                         13.00                       0.3677                             0.1452                                                                         14.00                       0.3405                             0.1252                                                                         15.00                       0.3152                             0.1079                                                                         16.00                       0.2919                             0.0930                                                                         17.00                       0.2703                             0.0802                                                                         18.00                       0.2502                             0.0691                                                                         19.00                       0.2317                             0.0596 PVF for 20 Years                     10.6036                             6.8775

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